Bill Start

Amended
IN
Assembly
June 11, 2017

CALIFORNIA LEGISLATURE—
2017–2018 REGULAR SESSION

Senate Bill

No. 105

Introduced by Committee on Budget and Fiscal Review

January 11, 2017

An act relating to the Budget Act of 2017.to amend the Budget Act of 2017 by amending Items 4260-101-0001 and 4260-101-0890 of, and to add Item 4260-101-3305 to, Section 2.00 of that act, relating to the state budget, and making an appropriation therefor, to take effect immediately, budget bill.

Digest Key

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

Item 4260-101-0001 of Section 2.00 of the Budget Act of 2017 is amended to read:

4260-101-0001—For local assistance, State Department of Health Care Services, California Medical Assistance Program, payable from the Health Care Deposit Fund after transfer from the General Fund
........................

The aggregate principal amount of disproportionate share hospital general obligation debt that may be issued in the current fiscal year pursuant to subparagraph (A) of paragraph (2) of subdivision (f) of Section 14085.5 of the Welfare and Institutions Code shall be $0.

2.

Notwithstanding any other provision of law, both the federal and nonfederal shares of any moneys recovered for previously paid health care services, provided pursuant to Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of the Welfare and Institutions Code, are hereby appropriated and shall be expended as soon as practicable for medical care and services as defined in the Welfare and Institutions Code.

3.

Notwithstanding any other provision of law, accounts receivable for recoveries as described in Provision 2 shall have no effect upon the positive balance of the General Fund or the Health Care Deposit Fund. Notwithstanding any other provision of law, moneys recovered as described in this item that are required to be transferred from the Health Care Deposit Fund to the General Fund shall be
credited by the Controller to the General Fund without regard to the appropriation from which it was drawn.

4.

Without regard to fiscal year, the General Fund shall make one or more loans available not to exceed a cumulative total of $45,000,000 to be transferred as needed to the Health Care Deposit Fund to meet cash needs. All moneys so transferred shall be repaid as soon as sufficient reimbursements have been collected to meet immediate cash needs and in installments as reimbursements accumulate if the loan is outstanding for more than one year.

5.

Notwithstanding any other provision of law, the State Department of Health Care Services may give public
notice relative to proposing or amending any rule or regulation that could result in increased costs in the Medi-Cal program only after approval by the Department of Finance. Additionally, any rule or regulation adopted by the State Department of Health Care Services and any communication that increases costs in the Medi-Cal program shall be effective only after the date upon which it is approved by the Department of Finance.

6.

Of the funds appropriated in this item, up to $50,000 may be allocated for attorney’s fees awarded pursuant to state or federal law without prior notification to the Legislature. Individual settlements authorized under this provision shall not exceed $5,000. The semiannual estimates of Medi-Cal expenditures due to the Legislature in January and May shall reflect attorney’s fees paid 15 or more days prior to
the transmittal of the estimate. The semiannual estimates of Medi-Cal expenditures provided to the Legislature in January and May may constitute the notification required by this provision.

7.

Change orders to the medical or the dental fiscal intermediary contract for amounts exceeding a total cost of $250,000 shall be approved by the Department of Finance not sooner than 30 days after written notification of the change order is provided to the chairpersons of the fiscal and policy committees in each house of the Legislature and to the Chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time after that notification as the chairperson of the joint committee, or his or her designee, may determine. The semiannual estimates of Medi-Cal expenditures provided to the Legislature in January and May may
constitute the notification required by this provision.

8.

Recoveries of advances made to counties in prior years pursuant to Section 14153 of the Welfare and Institutions Code are reappropriated to the Health Care Deposit Fund for reimbursement of those counties where allowable costs exceeded the amounts advanced. Recoveries in excess of the amounts required to fully reimburse allowable costs shall be transferred to the General Fund. When a projected deficiency exists in the California Medical Assistance Program, these funds, subject to notification to the Chairperson of the Joint Legislative Budget Committee, are appropriated and shall be expended as soon as practicable for the state’s share of payments for medical care and services, county administration, and fiscal intermediary services.

9.

The Department of Finance may transfer funds representing all or any portion of any estimated savings that are a result of improvements in the Medi-Cal claims processing procedures from the Medi-Cal services budget or the support budget of the State Department of Health Care Services (Item 4260-001-0001) to the fiscal intermediary budget item for purposes of making improvements to the Medi-Cal claims system.

10.

Notwithstanding any other provision of law, the Department of Finance may authorize the transfer of expenditure authority between Schedules (1), (2), and (3) of this item and between this item and Items 4260-102-0001, 4260-111-0001, 4260-113-0001, and 4260-117-0001 in order
to effectively administer the programs funded in these items. The Department of Finance shall notify the Legislature within 10 days of authorizing such a transfer unless prior notification of the transfer has been included in the Medi-Cal estimates submitted pursuant to Section 14100.5 of the Welfare and Institutions Code. The 10-day notification to the Legislature shall include the reasons for the transfer, the fiscal assumptions used in calculating the transfer amount, and any potential fiscal effects on the program from which funds are being transferred or for which funds are being reduced.

11.

If a federal grant that provides 75 percent federal financial participation to allow individuals in nursing homes to voluntarily move into a community setting and still receive the same amount of funding for services is awarded to the State
Department of Health Care Services during the current fiscal year, then, notwithstanding any other provision of law, the department may count expenditures from the appropriation made to this item as state matching funds for that grant.

12.

Notwithstanding any other provision of law, the Director of Finance may authorize an increase to this appropriation to address costs resulting from adverse court rulings. The Department of Finance shall provide a 30-day notice of any proposed increase to the Legislature. The notification shall include the specifics of any cases with adverse rulings and the overall fiscal impact. Submission of the semiannual Medi-Cal estimate provided to the Legislature in January and May shall be considered meeting the notification requirement of this provision if the required information is included in the
estimate.

13.

The Department of Finance may authorize the transfer of expenditure authority between Schedule (2) of Item 4300-101-0001 and Schedule (3) of this item to support the transition of current Medi-Cal eligible regional center clients receiving behavioral health treatment services pursuant to Section 14132.56 of the Welfare and Institutions Code upon completion of the statewide transition plan.

The Director of Finance shall provide notification to the Joint Legislative Budget Committee of any transfer of expenditure authority approved under this provision not less than 30 days prior to the effective date of the approval. The
30-day notification shall include a description of the transfer, including the number of children per regional center affected, the average cost of behavioral health treatment services for a regional center consumer, the average cost of behavioral health treatment services for a Medi-Cal enrollee, and assumptions used in calculating the amount of expenditure authority to be transferred.

14.

Of the funds appropriated in Schedule (3) of Item 4260-101-0001, Budget Act of 2016 (Ch. 23, Stats. 2016), $3,000,000 shall be available for the support of activities related to a medical interpreters’ pilot project, study, or both, and is available for encumbrance or expenditure until June 30, 2020. The Department of Finance may authorize the transfer of expenditure authority from Schedule (3) of Item 4260-101-0001, Budget Act of 2016 (Ch. 23,
Stats. 2016), to Schedule (1) of Item 4260-001-0001 of this act.

15.

The Department of Finance may authorize an increase in the appropriation of Item 4260-101-0001, up to $3,000,000 annually, until January 1, 2026, for purposes of reimbursing the Robert F. Kennedy Farm Workers Medical Plan consistent with Section 100235 of the Health and Safety Code.

16.

By no later than July 31, 2017, the State Department of Health Care Services shall provide each managed care plan with the appropriate detail, including beneficiary-specific data, aid codes, and corresponding rates paid, as well as the amounts of reimbursement to be recouped. Managed care plans subject to recoupment shall provide
recoupment payment in full by no later than June 30, 2018.

17.

Of the funds appropriated in Schedule (3), $1,201,000 shall be available for the support of activities related to the expansion of Waiver Personal Care Services state overtime exemptions. The Department of Finance may authorize the transfer of expenditure authority from Schedule (3) of this item to Schedule (1) of Item 4260-001-0001.

SEC. 2.

Item 4260-101-0890 of Section 2.00 of the Budget Act of 2017 is amended to read:

4260-101-0890—For local assistance, State Department of Health Care Services, payable from the Federal Trust Fund
........................

54,920,033,000
55,533,033,000

Schedule:

(1)

3960014-Eligibility (County Administration)
........................

3,572,251,000

(2)

3960018-Fiscal Intermediary Management
........................

252,964,000

(3)

3960022-Benefits (Medical Care and Services)
........................

51,094,818,000 51,707,818,000

Provisions:

1.

Notwithstanding any other law, the Department of Finance may authorize the transfer of expenditure authority between this item and Items 4260-102-0890, 4260-106-0890, 4260-111-0890, 4260-113-0890, 4260-114-0890, and 4260-117-0890 in order to effectively administer the programs funded in these items. The Department of Finance shall notify the Legislature within 10 days of authorizing such a transfer unless prior notification of the transfer has been included in the Medi-Cal estimates submitted pursuant to Section 14100.5 of the Welfare and Institutions Code. The 10-day notification to the Legislature shall include the reasons for the transfer, the fiscal assumptions used in calculating the transfer amount, and any potential fiscal effects on the program from which funds are being transferred or for which funds are being reduced.

2.

(a)

The Department of Finance is authorized to approve expenditures payable from the Federal Trust Fund (Item 4260-101-0890) in those amounts made necessary by changes in either caseload or payments.

(b)

If the Department of Finance determines that the estimate of expenditures will exceed the expenditures authorized for this item, the department shall so report to the Legislature. At the time the report is made, the amount of the appropriation made in this item shall be increased by the amount of the excess unless and until otherwise provided by law.

SEC. 3.

Item 4260-101-3305 is added to Section 2.00 of the Budget Act of 2017, to read:

The funds appropriated in this item are available for expenditure pursuant to subdivision (a) of Section 30130.55 of the Revenue and Taxation Code. The Legislature finds and declares that the expenditures are made in accordance with the California Healthcare, Research and Prevention Tobacco Tax Act of 2016 (Proposition 56). The Legislature finds that expenditures or supplemental payments described in Provision 3 and those applied to new growth in the 2017–18 fiscal year increase funding for the existing healthcare programs and services described in subdivision (a) of Section 30130.55 of the Revenue and Taxation Code, and that payments and support for the nonfederal share of payments for healthcare, services, and treatment are increased based on the criteria described in this item, which ensures timely access, limiting specific geographic
shortages of services or ensuring quality care. Expenditures shall be used only for care provided by health care professionals, clinics, health facilities that are licensed pursuant to Section 1250 of the Health and Safety Code, and to health plans contracting with the State Department of Health Care Services to provide health benefits pursuant to subdivision (a) of Section 30130.55 of the Revenue and Taxation Code.

2.

In order to effectively administer the Medi-Cal Program, the Department of Finance may decrease or increase this item in order to conform the appropriation to revised revenue estimates pursuant to subdivision (a) of Section 30130.55 of the Revenue and Taxation Code.

3.

Pursuant
to Section 30130.55 of the Revenue and Taxation Code, support for the nonfederal share of payments for health care, services, and treatment shall be made based on criteria outlined in this item. Of the funds appropriated in this item, up to $50,000,000 may be allocated for Women’s Health supplemental payments; up to $27,000,000 may be allocated for supplemental payments to Intermediate Care Facilities for the Developmentally Disabled; up to $4,000,000 may be allocated for HIV/AIDS waiver provider payments; up to $325,000,000 may be allocated for supplemental payments for physician services; and up to $140,000,000 may be allocated for supplemental payments on dental services. The State Department of Health Care Services shall develop the structure of these provider payments and post those parameters on its Internet Web site by July 31, 2017.

4.

Each
of the individual supplemental payments by provider type in Provision 3 shall not be available until all of the following conditions have been satisfied: the director of the State Department of Health Care Services (department) shall seek all necessary federal approvals to implement Provision 3; Provision 3 shall not be implemented until all necessary federal approvals have been obtained; Provision 3 shall be implemented only to the extent the department determines federal financial participation is available and is not otherwise jeopardized. Each of the supplemental payments by provider type in Provision 3 may be implemented independently as federal approval is received.

5.

Provision 3 applies only to the extent federal Medicaid policy does not reduce federal financial participation as projected in the annual budget act as determined by the
Department of Finance.

SEC. 4.

On January 10, 2018, and again on May 14, 2018, based on a determination of the state’s fiscal condition by the Director of the Department of Finance, the Department of Finance may direct the State Department of Health Care Services to adjust supplemental provider payments as budgeted in Item 4260-101-3305, up to a total of $800,000,000, for the following fiscal year. In determining the state’s fiscal condition, the Director of the Department of Finance may consider factors that include, but are not limited to, projected Medi-Cal pharmacy rebates; projected Medi-Cal expenditures; California Healthcare, Research
and Prevention Tobacco Tax Act of 2016 (Proposition 56) Revenues; the projected General Fund reserve, and economic factors. For funds allocated pursuant to this section for supplemental provider payments to physicians and dentists in Item 4260-101-3305, 70 percent of the allocations for these two provider types shall be for physician payments, and 30 percent shall be for dental payments.

SEC. 5.

This act is a Budget Bill within the meaning of subdivision (e) of Section 12 of Article IV of the California Constitution and shall take effect immediately.

SECTION 1.

It is the intent of the Legislature to enact statutory changes relating to the Budget Act of 2017.